2,4-D Survey in China – Market Report

2,4-Dichlorophenoxyacetic
acid (2,4-D) is an organic compound, serving as a systemic herbicide able to
selectively kill most broadleaf weeds. It is one of the oldest and most widely
available herbicides worldwide and is produced by many chemical companies since
the patent on it has long since expired.

2,4-D
is a widely used herbicide in the phenoxy class of chemicals. It is the most
commonly used pesticide in the non-agricultural sector and one of the top ten
most commonly used in the agricultural sector. The herbicide is effectively
used in numerous commercial lawn herbicide mixtures, as well as a weed killer
on cereal crops, pastures, and orchards. It is applied directly to aquatic and
conventional farming systems to control weeds and is among the most widely
distributed pollutants in the environment.

2,4-D
is a selective herbicide used to kill broadleaf weeds for post-emergent
control. It is a plant growth regulator and mimics the natural plant growth
hormone, auxin. 2,4-D remains at high levels within plant tissues and causes
rapid cell growth. Plants die when their vascular transport systems become
blocked and destroyed by abnormally fast growth. While 2,4-D is normally
applied to a plant’s leaves, it can be absorbed through the roots and stems.

In
the recent years, the 2,4-D industry in China had witnessed increasing capacity
but facing challenges not only from severe competition and the resulting
oversupply but also from environmental protection pressure by the government.
The overall operating rate of 2,4-D manufacturers can be described as unstable
during the last years. According to market intelligence firm CCM, from 2015 to
2016, the output of 2, 4-D technical increased by 12.57% and 25.28% year on
year respectively. In 2016, the capacity of 2,4-D technical increased by 32.29%
year on year, while the operating rate of 2,4-D technical producers remained
stable, which contributed to the significant increase in the output of 2,4-D
technical in 2016.

In
China, over 60% of 2,4-D technical produced in the country is getting exported
overseas while the remaining one-third is used to produce other 2,4-D products,
mainly including 2,4-D butylate, 2,4-D amine salt, 2,4-D-Ethylhexyl and 2,4-D
Na. 2,4-D products are utilized as herbicides in the form of esters and amine
salts. In the domestic market, the main specifications of 2,4-D formulations
include 2,4-D butylate 57% EC, 2,4-D amine salt 720g/L SL, 2,4-D amine salt
860g/L SL. In the past five years, the domestic apparent consumption volume of
2,4-D fluctuated along with the changes in supply and demand.

In
recent years, 2,4-D industry in China also confronted with barriers, including
sluggish demand from the overseas market, pressure from illegal producers,
difficulty in pollutant treatment, besides others. Many illegal factories have
been producing 2,4-D products during 2011–2012, which had dragged down the
growth of market price to some extent because of additional supply. Otherwise,
the growth of 2,4-D's market price should be larger since the demand from
downstream industry was impressive at that time. For years, although some legal
enterprise associations have tried to beat the illegal production through the
authorities, however, this effort was hardly rewarding. What's worse, some
illegal 2,4-D manufacturers even exported their 2,4-D products with the help of
some import & export companies.

Pollutant
treatment is a major problem for 2,4-D technical manufacturers. A great deal of
wastewater is generated during the production of 2,4-D technical. With stricter
requirements about environmental protection, the pollution problems would restrict
the development of 2,4-D industry to some extent. For illegal 2,4-D producers,
they don't invest in the pollutant treatment devices, which gives their
products an edge on price; thus, the 2,4-D industry was severely disturbed.

Oversupply
has occurred in China's 2,4-D industry. It is predicted that policies issued by
the government, especially environmental protection policies, will impose the
largest effect on its future development.